Ondo Finance is pushing its tokenization business beyond public stocks and U.S. Treasuries and into private companies that have not yet listed. On Tuesday, the firm announced Ondo Private Markets, a product offering tokenized notes designed to track the value of individual private companies.
The first market references an unnamed pre-IPO AI company and is expected to begin secondary trading this week. Ondo said names in robotics, cybersecurity, biotech and infrastructure will come next. A company blog post also listed defense, energy and space.
The product is open only to eligible investors outside the U.S., in jurisdictions where it is permitted.
How the notes are structured
According to Ondo, payouts depend on what the referenced company’s common stock is worth per share when a qualifying liquidity event occurs. Buyers do not receive stock. The company said the notes are obligations of their issuer and do not give holders ownership or shareholder rights in the underlying company.
Holders can keep the tokens in self-custody wallets, send them to other eligible holders, trade them on secondary markets around the clock, or deploy them in DeFi. Ondo said tradability is meant to address a long-standing issue in private markets, where investors can wait years for an IPO before they are able to sell.
In the U.S., the majority of investment options available to retail investors are public companies, yet 87% of companies with more than $100 million in revenue are private, Ondo said. Ian De Bode, Ondo’s acting CEO and president, said in the release: “That’s where many of the leaders defining the next era of our economy are emerging, and retail investors can’t access them today. Ondo Private Markets is built to change that, bringing tokenized exposure to the world’s best companies with 24/7 trading on permissionless rails.”
Different from Ondo’s U.S. tokenized securities
Ondo said the infrastructure behind its tokenized stocks and Treasuries holds $3.7 billion in total value locked across more than 1 million cumulative holders.
The new notes are structured differently from the tokenized BlackRock ETF and Micron shares that Ondo brought onchain in July within the U.S. regulatory perimeter. Those tokens are backed one-for-one by custodied securities and give holders proxy voting rights.
Coinbase has also offered pre-IPO exposure through a different instrument: derivatives. In June, it listed SpaceX pre-IPO perpetual futures on its international exchange, likewise limited to users outside the U.S.
Ondo has not disclosed which AI company the first notes reference, and it has not said which trading venues will list them.